Comparison rate warning:This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

Disclaimer:This calculator is to be used as a guide to help you better understand your options. We have not assessed what options are suitable for your needs or if you meet other lending criteria that would allow you to access your equity. Any repayments quoted above are calculated using your current home loan balance over a term of 30 years. We strongly recommend that you make additional repayments and pay your loan off sooner. If you borrow over 80% of the property value then you may pay an LMI premium.

What is cash out?

Any home loan which has the funds released to you directly is considered to be cash out by the banks. Some banks will decline your application due to the amount of equity being released and what your intentions are.

Some examples are:

Minor cosmetic renovations.

Debt consolidation.

Investment in shares.

Releasing equity to use as a deposit on your next property.

Buying a business or for investment in your business.

Whereas other types of loans aren’t considered to be cash out, and so are not subject to restrictions:

Construction loans.

Funds to purchase a specific property with a signed contract as evidence.

Refinancing an existing home loan.

How much cash out is acceptable?

Most lenders require evidence of the purpose of the loan if you’re releasing more than $10,000 to $50,000 as cash out. This requirement is particularly strict for people seeking a low doc loan.

Our best lenders only require you to disclose the purpose of your loan, but you don’t have to provide evidence!

How much cash out can I release?

One of our lenders will allow you to release up to 90% of the value of your home, up to a maximum of $800,000 or up to 80% of the value of your home up to $1,000,000.

For example, if your home is worth $1.25 million then you may be entitled to borrow $1 million.

These funds can be released as either a Line of Credit, into an offset account or into your bank account to use as you see fit.

Why is "cash out" so risky?

When your equity loan is advanced by the bank, a large lump sum of money is released directly into your bank account or into a line of credit for you to use later.

Once this has been done, the banks no longer have any control over how you use those funds.

Banks are concerned that you won’t use the funds according to your intended purpose. Some people may use the money to make the loan repayments because they’re living beyond their means.

Can I release equity for investment purposes?

The most common reason that people apply for an equity loan is to use the funds to invest in property or shares. This is one of our specialities!

We can recommend you a specific loan product, with no cash out restrictions and the features you need to get the maximum benefit out of your investments.

Discuss your investment goals with us on 1300 889 743 or enquire online.

Our responsible lending commitment

We always endeavour to fully understand your needs and aim to offer you expert help to get the most suitable loan product available.

Our mortgage brokers are committed to responsible lending practices. We won’t help you to get a loan unless there’s a clear benefit to you, and a low risk that you’ll misuse the funds.

How can I apply for a cash out loan?

Please enquire online or dial 1300 889 743 to speak to one of our mortgage brokers who specialises in releasing cash out with a home equity loan.

Hi Fiona,
Yes we can do this in two different ways. We can release equity usually up to 80% of the value of his property, but up to 90% in some cases. E.g. if he owes $300,000 then he could release up to $480,000 (80% of $600k) which would mean he could give his brother $180,000 to use towards his house.

Hi kennedy,
We have on our mind a few lenders that may be able to help with this but we’ll need more information to properly assess your situation and recommend the best available lenders for you. Please call 1300 889 743 and speak with one of our cash out specialists to find out your options.

Berynie

I have a few credit cards and personal loans. Can I extract equity from my mortgage and get those debts consolidated into it?

Yes Berynie, most of the lenders allow you to consolidate your other debts in your existing home loan. You can borrow up to 80% of the value of your property if you can provide a stated purpose (no evidence required). Moreover, you can release up to 90% of the property value with evidence of the use of the funds.

Tina Cox

I need to consolidate my credit cards and a small loan pay them off and have one payment my house is worth $350,000 approx. its a new house and I have no mortgage

Hi Tina,
Yes this is easy to do as long as you are currently working. Note that for small loans we charge a brokerage fee as there is significant work involved. However I’ll email you with some tips. If your loan is over $200,000 then likely we wouldn’t have any fees.

Alex

Equity release in the current lending condition (tighten up lending) still possible? Can the equity release be used for any investment purpose e.g. buy share? do I need to state the purpose at the time of application? how long would it take from application to fund release? up to 80% of the value of the property or of amount owing? do you need to order a valuation on my property?

Hi Alex,
Yes it is still possible as long as it all makes sense. Different lenders have different requirements. Yes the funds can be used to buy shares or other investment purposes. Some lenders require evidence and others just require a stated purpose, however this varies depending on the amount that you’re after and % of the property value you are seeking.
The time taken varies but cheap lenders tend to take four weeks. There’s more expensive options that are faster.
Typically 80% of the property value is easy. Up to 90% is harder.
Yes a valuation is normally required.

Alex

What’re the main different features of equity loan among different lenders? Is it a good idea to cash out to the max e.g. 80% since I’m gonna submit an application anyway? this way I can always use some for other investment purposes. When you refer to ‘cheap lenders’ what did you mean? low fees? low rate? or non-bank lenders? One thing about this type of loan (offset and/or line of credit) normally they are expensive features with higher fees, aren’t they? and do you, as a broker charge any fees for this type of loan application?

Hi Alex,
If you’ve got several questions it’s best to speak to one of our brokers on 1300889743 and they can give you specific recommendations for your situation.
1. The loan features are the same for a standard loan. You can choose basic, offset or line of credit.
2. You should generally stick to borrowing what you need. Some people manage their money well and in those cases it may be ok to have extra in case of an opportunistic investment however we tend to avoid this.
3. When we say cheap we mean competitive interest rates and fees. The exact rates etc would depend on the loan amount, purpose, LVR and security. Interest only is significantly more expensive so more people are choosing P&I these days.
4. We charge fees for small loans (<$300,000) or if you repay the loan in the first two years however there are exceptions. It's best to discuss with our brokers. Most customers pay no fees for our services.

Alex

Sounds good. Small loans <$300k, what do you calculate this? for example, one of my investment property is value at $860k (owing $400k) which I like to cash out 80%, $288. Would this consider a small loan?
If I use it for short term investment for example, renovation and sell, in this case the project is less than 2 years for sure. (more like 12 months) I have to pay loan exit fee, don't I? how much is the fee then?

Hi Alex,
That wouldn’t be a small loan as the total loan is $688,000.
The fee is typically 0.77% of the loan in year 1 and 0.385% of the loan amount in year 2.
We’re just passing on the fee that the lender charges us. Some lenders have a reduced fee or only have a fee for 12 months so if you sell after a year there is no fee. Just let our brokers know and they will take this into account with their recommendation

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